The quotas for the 2023-2024 financial year have been released, and the Department of Home Affairs has not allocated any investor-migration places to the states. This is not great news for applicants hoping to migrate through investment, but applicants who already hold a Subclass 188 visa are not affected in any way.

This is because the state nomination obtained by Subclass 188 holders when applying for the Subclass 888is notsubject to thestate-nomination quota the Commonwealth allocates each financial year.As a result, Subclass 188 holders can continue under the existing policy and, where they meet the relevant requirements, transition to the Subclass 888 permanent visa.

For example, according to the Western Australian Government’s announcement, 188-to-888 nomination applications can still be lodged

qld

For another example, according to the Queensland Government’s announcement, the second stage (the 888 state-nomination application) remains open as usual and is not affected by this year’s quotas.

And, for instance, according to the South Australian Government’s announcement, 188-to-888 state-nomination applications have no quota limit and can still be lodged

What’s more, the Department of Home Affairs has indicated that it will assign more staff to clear the backlog of investor-migration visas.

So today, let’s take a look at exactly what conditions are required to transition from a Subclass 188 visa to a Subclass 888 visa.

Today we focus on Stream A of the Subclass 888 category,i.e. the Business Innovation Stream, commonly known as the small-business / business-innovation / SME entrepreneur stream. In terms of numbers, Stream A should be the largest.

The Subclass 888 Stream A permanent visa is an investor-migration permanent visa that an applicant holding an Australian Subclass 188A Business Innovation and Investment (provisional) visa can apply for from within Australia, once they have operated a business in Australia and met the relevant asset and other conditions.

The 188A-to-888A process

Key features of the Subclass 888A visa

1. The Department of Home Affairs imposes no mandatory English language requirement on applicants (applicants aged 18 or over can meet it by paying a language-training fee instead)
2. The primary applicant for the Subclass 888A visa may be the secondary applicant from the Subclass 188A visa, to suit the family and business arrangements of some Subclass 188A holders
3. The total investment required is low, a minimum of AUD 600,000 meets the requirement;
4. For Subclass 188A visas granted after 1 July 2021, applicants can apply for permanent residency once they have held the Subclass 188A for 3 years and operated a business in Australia for 2 years (i.e. 24 months).
5. Eligible family members can be included in the permanent visa application;
6. Free travel in and out of Australia for the duration of the visa;

7. Visa-free entry to New Zealand

8. You can apply for Australian citizenship once you meet the residence requirement;
9. Children enjoy local-student status at school;
10. Access to Australia’s public healthcare and other social welfare benefits

Eligibility requirements for the Subclass 888A visa

1. The applicant holds a Subclass 188A visa or a Subclass 188A renewal.

2. Meet the health and character requirements;
3.Obtain nomination from an Australian state or territory government (you must meet each state or territory government’s specific state-nomination requirements; Western Australia is used as an example below);
4. Before lodging the application, the primary applicant must have held a shareholding in, and participated in the day-to-day management of, their main operating business in Australia (up to 2 businesses) for at least 2 years (i.e. 24 months).

5.Main business and shareholding requirements:

6. In the 12 months before lodging the application, the business’s annual turnover must reach at least AUD 300,000 (excluding GST);
7. In the 12 months before lodging the application, you must meet 2 of the following 3 conditions:
   -Employed 2 Australian local full-time, or full-time equivalent, employees (who cannot be the applicant’s immediate family members);
   -The business and personal net assets in Australia total at least AUD 600,000;
   -The net business assets total at least AUD 200,000
8. For applicants whose first Subclass 188A visa was granted after 1 July 2021, in the 3 years before lodging the application, the primary applicant must have held the Subclass 188A visa and lived in Australia for at least 1 year in total.

Using WA’s policy as an example

188A-to-888A state nomination

The above are the Department of Home Affairs’ visa requirements. Next, using Western Australia as an example, let’s look at what particular requirements and features the state government applies at the state-nomination stagefor the 188A-to-888A permanent visa.

1. The Western Australian Government does not restrict business activities, but it does have some special requirements for certain industries. For example, in a property-development business, the number of properties developed must be no fewer than 3

2. For an import-export business, the products or services traded must be predominantly sourced from Western Australia and exported overseas

3. ‘Recycling of business’ is not permitted, i.e. if the business you intend to operate has already been used by another applicant for a state nomination, it will not be nominated again.

4. If you choose to change your original business plan partway through, you must apply in writing to the Business Migration Centre (BMC) and obtain approval.

5. If you wish to change the state in which your business is established partway through, you must lodge a formal application and attend an interview at the BMC; a change to another state will only be permitted in special circumstances.

As you can see, in addition to meeting the standard Department of Home Affairs visa requirements, the state government’s requirements must be met as well. Each state’s requirements differ depending on factors such as its economic development, level of demand and popularity. If you’d like to know more about other states such as NSW, Victoria or Queensland, you’re welcome to contact me directly.

We recommend getting in touch with us early, as soon as you’re considering applying, so we can carry out a pre-assessment for you and avoid a situation where, after several years, you discover the business you’ve been operating doesn’t meet the requirements for permanent residency.

Q&A

Frequently asked questions about 188A-to-888A

1. After my Subclass 188A visa was granted, I didn’t manage to operate the business for two full years, or the business isn’t yet up to standard, but my visa is about to expire — what can I do?

A: If your Subclass 188A visa doesn’t run long enough, you can apply for one extension, valid for two years.

2. The business turnover requirement is AUD 300,000 — does that include GST?

A: No, it does not.

3. Because of the pandemic, I was away from Australia for a long time and can’t meet the residence-duration requirement to transfer to the Subclass 888A visa — what can I do?

A: If your first Subclass 188A visa was granted before 1 July 2019 and you were stranded overseas due to the pandemic from 1 February 2020, your time overseas can also count as time spent residing in Australia. You may lodge the Subclass 888 application from 19 September 2020 until 3 months after the end of the pandemic concession period.

4. My Subclass 188A visa expired during the pandemic — what can I do?

A: If your first Subclass 188A visa was granted before 1 July 2019, then as long as you meet the other Subclass 888A eligibility conditions you can still apply for the Subclass 888A visa from 19 September 2020 until 3 months after the end of the pandemic concession period.

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